This as-told-to essay is based on a conversation with Rod Dubitsky, 62, a fintech startup founder who lives in New York City. Dubitsky’s mother lives in assisted living, which costs upward of $7,000 monthly. Dubitsky said he’s considering moving to Spain, where his out-of-pocket costs for long-term care will be lower than in the US. This interview has been edited for length and clarity.
Most of my career has been spent working in Wall Street-related finance.
I covered subprime mortgages during the financial crisis and also autos, credit cards, and student loans. I built a fintech startup called The People’s Economist to help people with their personal finance issues, ranging from budgeting to debt management to portfolio management. I also do a lot of research on private equity and private credit insurance companies, which intersect with my consumer focus because they influence a lot of assisted living and nursing homes.
I’m the middle child, and I have two sisters who all live within daily commuting distance of my mom. I’m divorced with one son in college. My mom and dad both worked for the government as blue-collar workers. My mom was a mail sorter in the post office, and my father was a customs inspector.
My mom was living at home independently at a retirement home community
My mom, 88, was very independent for a while, driving on her own. She landed in the hospital a few times, mostly short-term, for diabetes-related reasons, and she sometimes forgot to take her medication.
At one point, we decided she couldn’t drive because it wasn’t safe for her. She had passed out while driving once, and she could have hurt herself or others. Once that happened, she basically couldn’t leave her home. She didn’t mind this much, as she had a dog and a TV, but her weekly mahjong games ended, as well as her weekly breakfast with her friends.
We began monitoring her blood sugar through an app, which was a game changer with her short-term memory issues. We’d have to call her so many times a day to remind her to take her meds, so that’s when we started looking into assisted living. We also looked at in-home care, but none of the options quite worked, because if they’re there for four hours a day, they’re not there when she takes her night insulin.
My mom moved into assisted living less than a year ago
When trying to find a facility for my mom, I would encourage her to look at who the owners are, which could impact the quality and cost of care. Very few of them published the breakdown of their costs, and when there is a crisis, there are a lot of add-ons that are not easily comparable. We picked one that was a not-for-profit.
The assisted living said that she had to go on a medication management add-on. That increase for the care package, on top of the $5,800 base monthly pay, costs $1,500 a month. If she stayed in independent living, the cost would be almost as high, and she wouldn’t receive any benefits. The low end of independent living, with no meals included, would be $4,000 monthly, but a decent facility with meals and medication management can get you to $8,000.
Read more of our long-term care coverage
My mom is still caring for herself. We haven’t considered memory care, which would add on a couple of thousand dollars a month. There is free transport to a doctor within the facility’s radius. It works for her, though it may be a problem down the line if she has to see an out-of-network doctor.
We would need to sell her apartment
All but $2,000 of the monthly bill is covered by her pension. The rest is coming from savings, though that will include the sale of her apartment once that closes, which should cover her for a number of years.
In 2009, my mother qualified for an affordable apartment, which was much cheaper than buying an apartment right off the market. It was right after the financial crisis, so we got a great deal. Fast forward, we’re trying to sell that apartment, but it’s appreciated less than other apartments at the market rate, which would have funded a lot more of her assisted living costs. In rough numbers, the apartment value would probably have doubled if it were a market apartment. I’m not sure we would have done anything differently.
Of course, healthcare inflation has soared far beyond the Consumer Price Index. Making the conservative, prudent decision at the time means less money to pay for healthcare. The same could be said of too conservative investments; safer decisions made 15 years ago mean less money now.
Assisted living costs are not covered by her insurance, even though it’s healthcare, and she ends up paying $9,000 in taxes on her income. My mom still has to pay taxes, despite the fact that her assisted living costs, at least medication management, are healthcare and should be deductible. It’s a broken part of our tax system that we still have to factor in tax expenses, even though she’s negative.
I have permanent residency in Spain and have an apartment in Barcelona
I have to buy private health insurance in Spain because I don’t qualify for the national health insurance program. What I pay in two months in New York basically funds my entire year of private health insurance in Spain, and the cost of care you’re paying out of pocket without insurance is much lower in Spain than in the US.
I don’t have short-term plans to move to Spain, but given the trajectory of the US and the costs of inflation and healthcare insurance, there doesn’t seem to be any plan to fix it. Even if I pay higher taxes in Spain, I still end up saving money.
Anyone considering going into assisted living should think about the next level and the ecosystem network, such as memory care, nursing homes, and physical therapy. Think about what you would do if that next level is needed ahead of time, because if you’re just narrowly focused, you then have to start the whole process again of finding another facility.
